Young Black High School Grads Face Astonishing Underemployment

Last week, I wrote about how high school graduates will face significant economic challenges when they graduate this spring. High school graduates almost always experience higher levels of unemployment and lower wages than their counterparts with a college degree, and their labor market difficulties were particularly exacerbated by the Great Recession. Despite officially ending in June 2009, the recession left millions unemployed for prolonged spells, with recent workforce entrants such as young high school grads being particularly vulnerable.

Underemployment is one of the major problems that young workers currently face. Approximately 19.5 percent of young high school graduates (those ages 17–20) are unemployed and about 37.0 percent are underemployed. For young college graduates (those ages 21–24) the unemployment rate is 7.2 percent and the underemployment rate is 14.9 percent. Our measure of underemployment is the U-6 measure from the BLS, which includes not only unemployed workers but also those who are part-time for economic reasons and those who are marginally attached to the labor force.

When we look at the underemployment data by race, we often see an even worse situation. As shown in the charts below, 23.0 percent of young black college graduates are currently underemployed, compared with 22.4 percent of young Hispanic college grads and 12.9 percent of white college grads. And as elevated as these rates are, the picture is bleakest for young high school graduates, who are majority of young workers.

Underemployment

Underemployment rate of young college graduates, by race and ethnicity, 2000–2015*

* Data reflect 12-month moving averages; data for 2015 represent 12-month average from April 2014 to March 2015.

Note: Data are for college graduates age 21–24 who are not enrolled in further schooling. Shaded areas denote recessions. Race/ethnicity categories are mutually exclusive (i.e., white non-Hispanic and black non-Hispanic). The Hispanic category is not included due to insufficient sample sizes over part of the series.

Source: EPI analysis of basic monthly Current Population Survey microdata

51.3 percent of young black high school graduates are underemployed, compared with 36.1 percent of young Hispanic high school grads and 33.8 percent of white high school grads. This means a significant share of young high school graduates in all racial groups either want a job or have a job that does not provide the hours they need. A majority of young black high school graduates wish they could work more but can’t because of weak job opportunities.

Underemployment

Underemployment rate of young high school graduates, by race and ethnicity, 2000–2015*

* Data reflect 12-month moving averages; data for 2015 represent 12-month average from April 2014 to March 2015.

Note: Data are for high school graduates age 17–20 who are not enrolled in further schooling. Shaded areas denote recessions. Race/ethnicity categories are mutually exclusive (i.e., white non-Hispanic, black non-Hispanic, and Hispanic any race).

Source: EPI analysis of basic monthly Current Population Survey microdata

While there has been real progress in healing the damage inflicted on the labor market by the Great Recession, these underemployment rates among young high school graduates remain quite elevated relative to pre-recession levels. In order to correct these high rates, we need to prioritize low rates of unemployment and boost aggregate demand for workers. Last week, Senator Bernie Sanders and Representative John Conyers introduced the Employ Young Americans Now Act to help young Americans find pathways to employment. This bill is a necessary first step to putting young high school graduates back to work and to put our economy on the road to full employment.

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EPI is an independent, nonprofit think tank that researches the impact of economic trends and policies on working people in the United States. EPI’s research helps policymakers, opinion leaders, advocates, journalists, and the public understand the bread-and-butter issues affecting ordinary Americans.